Profitability of Natural Rubber Production and Processing: A Case of Delta Rubber Company Limited Okomoko/Umuanyagu Etche, Rivers State


Volume/Issue : Volume 6 - 2021, Issue 5 - May

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The study examined the profitability of Natural Rubber Production and Processing by Delta Rubber Company Limited, Okomoko/Umuanyagu Etche, Rivers State. The objectives of the study were to assess the average yield of rubber plants per hectare from the different plantations, to examine the annual turn-over and profit of the company for the period 2001-2004 and to identify the problems affecting the operation of Delta Rubber Company Limited. The Company has five (5) Rubber Plantations with a total hectarage of Ten Thousand Seven Hundred (10,700) hectares. Also the company has a crumb rubber processing factory situated at Umuanyagu Etche, with a capacity of about Six hundred (600) matric tonnes of crumb rubber per month or 23MT per day. But it is presently operating between 20-40% capacity utilization, processing about 10-12 MT per day. A review of the balance sheet and income statement of the company for the years under review showed that there was an increasing inflow of profit. Various analysis based on NPV, BCR, IRR, CCR, NCR shows as follows- (NCR>1) 1.78,3.85,3.89,4.36 for the period of 2001, 2002, 2003, 2004 while (CCR>1) with 0.804, 1.28, 1.56, 1.45, Return on Assets (ROA) was 114.7%,89.7%,84.37%,77.4% all proves that the Delta Rubber Company made profits during the period under review. However, some problems were identified such as insecurity frequent stealing and vandalization by youth, inadequate attention by the Government. The researcher therefore recommended that there should be improved company/host community relationship, adequate security arrangement and additional capital funding by the state Government to enable the company expand its scope of operations, and produce export grade crumb to attract foreign exchange and boost our Agro-sector economy.


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30 - September - 2021

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